On The Source And Effect Of The Start Capital Of Private Enterprises

With the private enterprises rising from 1980's in our country, the forms of start capital are not limited to the internal financing. The external financing has become more and more common. It contains the loan from civilian financial organization, trade credit and financial institution's loan. These diverse forms of start capital contribute to satisfying the need of the private enterprises' financing.This paper begins with the present conditions and problems of private enterprise's start-up financing and points out that based on the obvious comparative advantage, this irregular financing way has developed a more important function in the private enterprises.Then this paper analyzes four kinds of familiar irregular financial forms, and puts great emphasis on the evolution of their joining in private enterprises' start-up financing, and the mechanism of their the contract formation and risk management respectively. Further more, in this paper, I made a comparison between financial institution's loan and the trade credit with econometrical analysis, in order to indicate that these two kinds of start capital have different functions and formative reasons (namely impact factors). In the meantime, as the regular financial institutions, the small and medium financing institutions have become a leading force to support private enterprises, due to its dominance of the soft information managemet .And then, the paper analyzes two creative small Ioan modes of the small and medium financial institutions in order to learn much from their experiences.Finally, this paper puts forward the suggestions to support the start-up financing of private enterprise and the development of private economy, based on the analysis made above.